Lahore - Even those sugar millers in Punjab are facing govt action, which have strong connection in power corridors, as the Punjab government has taken over nine defaulting sugar mills so as to auction them to clear dues of sugarcane growers.

Out of the defaulting mills, three sugar mills are owned by Mian Ilyas including Abdullah Sugar Mills Okara, Abdullah-II Sugar Mills Sargodha and Haseeb Waqas Sugar Mills Nankana Sahib while Brother Sugar Mills is also owned by Aslam Bashir.

In the same way, Shakar Ganj–I Sugar Mills Jhang and Shakar Ganj–II Sugar Mills Jhang which have also been seized by the provincial government are owned by former federal Minister Salim Altaf.

Rest of the mills belonged to renowned business families, including Hussain Sugar mills owned by Ahmed Tariq and Colony Sugar Mills owned by Naveed Sheikh.

There are 45 sugar mills in Punjab out of which only two are owned by the ruling Sharif family while 12 out of 37 sugar mills of Sindh are owned by the Zardari family.

The mills were taken over by the DCOs concerned under Punjab Sugar Factories Control Act, all sugar mills were bound to make payment to the growers within 15 days of the purchase of sugarcane.

Earlier, sugarcane of Rs50 million of Colony Sugar Mills was auctioned and dues of the farmers were cleared.

The Pakistan Sugar Mills Association Punjab Chairman Javed Kayani, talking to The Nation, said that sugar mills have cleared almost 99 percent payment to the growers as Rs134 billion have been paid to farmers out of Rs137 billion while only Rs3 billion have been left for the crushing season of 2014.

Javed Kayani supported action against sugar mills for payment of dues to farmers but demanded that government should also adopt a balanced approach and take care of all stakeholders.

He said that Punjab sugar mills are to pay just Rs3 billion to farmers and action is being taken against them but the government itself is not clearing its Rs2.66 billion outstanding rebate amount to sugar mills pending for the last three years. In the same way, the Central Bank is also not paying about Rs2.5 billion amount of last fiscal year rebate to millers.

Javed Kayani said that PSMA for the last several months has been urging the provincial government to intervene and support the mills for payment to cane growers, as the industry cannot make full payment due to liquidity crunch.

Javed Kayani said that the Punjab government’s unilateral fixation of sugarcane price at Rs180 per 40kg created a purchase price difference of Rs22 per 40kg within the country, lifting the Punjab industry cost by at least Rs22.5 billion. He said that additional cost of Punjab millers have also rendered them uncompetitive within the country against the Sindh sugar industry, which is also enjoying provincial government support besides getting exemption of road cess.

After comparison with Sindh, the calculation shows the rate of sugarcane in Punjab should stand at Rs158 per 40 kg. Hence, the Punjab government, in line with the Sindh authorities, should announce the additional payment of Rs22 per kg, besides formulating a policy to issue interest-free loans to sugar mills which are already facing forced closure. The Punjab government should follow the path of Sindh to help the industry for timely payment to growers, instead of harassing the millers.

“Instead of providing us a level-playing field, facilitating mills to operate without any disruption, the police and district authorities are creating hurdles and harassment. He said that if government continues to announce cane support price than it should also intervene to stabilize sugar prices to avoid losses faced by the millers, he argued.

The government should, first, resolve all these issues of the industry then should take action against those who are not paying dues of farmers.